more bad news from fin review. Contractor accuses Multiplex of...

more bad news from fin review. Contractor accuses Multiplex of undue pressure
Robert Harley
2006/01/17



The Multiplex Group has been accused of making substantial claims against the key steel subcontractor on the crippled Wembley Stadium project in the hope that the subcontractor would "fall over under the pressure".

The accusation emerged as the subcontractor, Cleveland Bridge UK, lodged its amended defence and counterclaim before a major legal battle due in court in April.

"Multiplex's aim was to make substantial financial claims against CBUK in an attempt to ensure that CBUK (which it knew to be facing cash-flow problems) would then 'fall over under the pressure'," claimed one document lodged on behalf of CBUK.

The documents allege that in May 2004, Multiplex's Wembley project director, Ashley Muldoon, sent an email outlining a so-called "Armageddon option" to Multiplex's then United Kingdom managing director for construction, Matthew Stagg.

"In an email in reply of the same date," the document stated, "Mr Stagg referred to the proposed course of action as follows: 'Plan B: CBUK fixed and f--- them later?"'


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The document, acquired by Construction News and sighted by The Guardian, was reported in the UK last week. Multiplex declined to comment on the specifics of current litigation.

A spokesman said Multiplex would lodge its documentation for the case soon.

It was confident of a positive claims outcome that would vindicate the group's position.

The Wembley National Stadium in London has two distinctive steel arches. The contract to supply and erect the structural steel for the arches was one of the most critical in the project.

Relations between Multiplex and CBUK continued to deteriorate throughout 2004.

CBUK eventually quit the job and was replaced by Hollandia.

In November CBUK served claim on Multiplex for more than £20million ($47 million) in money withheld, damages incurred and interest. Multiplex, which argued that certain steel members had been found to be defective, also has a log of claims against CBUK.

Meanwhile, Multiplex confirmed yesterday that Bob McKinnon, who became chief financial officer in November, had joined the board.